Network Rail’s top five directors have pocketed more than £350,000 in bonuses
and been rewarded with a 2.5pc pay rise despite train punctuality falling
and being criticised by the industry regulator.

The decision to take an annual bonus for the first time in three years came against a backdrop of withering criticism by Anna Walker, chairman of the Office of Rail Regulation. over the company’s performance and stewardship of the track infrastructure.

While recognising some of the company’s successes over the past year, she was scathing in her assessment of a series of failures over the past year in a letter to Richard Parry-Jones, Network Rail’s chairman.

“You have been unable to deliver consistently and there remain significant and persistent issues where Network Rail’s performance falls short of what it was funded to deliver and therefore what she expected as a regulator.”

In a letter, copied to Patrick McLoughlin, the Transport Secretary and the two rail ministers, Norman Baker and Simon Burns, she said the company had performed particularly badly in London and the South East.

She added: We are concerned about the low levels of proactive maintenance and the growing backlog of work which are contributing to poor track quality in some areas.”

When track failures did occur delays had been longer than in the past, she added.

The regulator’s remarks will heighten the controversy over bonuses at a time when passengers are facing another year of above inflation fare rises.

Network Rail had tried to dampen down the row by saying the bonuses were not only lower than the previous incentive scheme but had also been reduced further to take into account its failure to meeting the punctuality target set by the Office of Rail Regulation.

Nevertheless, the senior executives, who declined annual bonuses for the two previous years, come at a time when punctuality dropped from 91.6pc in 2011-12 to 90.9pc in the following year.

The biggest winner is Sir David Higgins, the chief executive who will receive a £99,082 bonus on top of his current £577,000 salary.

Patrick Butcher, the group finance director, will get £67,658 bonus in addition to his £394,000 annual pay. Robin Gisby and Simon Kirkby, respectively the managing directors for network operations and infrastructure projects, will top up their £371,000 annual salary with another £63,708.

Paul Plummer, the group strategy director, gets another £59,759 on top of the £348,000 he is paid by the company, which is responsible for the country’s track infrastructure.

The five men are also in line for a long-term bonus, covering the company’s performance from 2012-15. However, details of the scheme are still under negotiation.

Ministers have been under pressure to curb the bonuses paid to Network Rail chiefs, which opponents have in the past described as excessive.

Network Rail had tried to damp down the controversy by cutting the maximum annual bonus from 100pc of salary to 60pc.

The failure to meet the regulator’s punctuality target has resulted in the five men being paid bonuses amounting to 17pc of their salary.

However, the company insisted the bonuses were justified with passenger satisfaction reaching a record high of 85pc at a time when the country’s trains were carrying more people than since the 1920s.

“Our executive bonus payments for this year correctly reflect successes as well as shortcomings,” said Mr Parry-Jones.

But this failed to satisfy Maria Eagle, Labour’s transport spokesman, who condemned the payments. “Commuters facing inflation-busting fare rises will be outraged at the scale of the bonus packages being enjoyed by a few at the top of the rail industry,” she said.

“With many passengers facing overcrowded services and too many delayed and cancelled trains, it is wrong for Network Rail to be paying out such large sums to its senior managers. It will particularly anger passengers that these bonuses are being paid for a year when Network Rail has failed to meet its own performance target on train punctuality.”